Using Porter's five forces to analyse Telstra Australia

Topics: Strategic management, Barriers to entry, Marketing Pages: 4 (802 words) Published: April 7, 2004
Business Structure

Telstra is Australia's leading fully integrated telecommunications and information services company. Telstra's organizational structure consists of Telstra Retail, Telstra Mobile, Telstra Country Wide, Telstra Wholesale, Telstra International infrastructure Services and Network and Technology Group. They offer a range of services from landline telephony, to complex mobile services, to high speed broadband. As required by the legislation, the Federal government remains 50.1% majority shareholders. However, the majority of the market shares are concentrated on several key market competitors.

Rivalry among existing firms

The telecommunication market is growing in a decreasing rate in the last few years due to competition increment after the industry's deregulation in July 1997. Major competitors of Telstra are Optus, Primus, AAPT, Orange and Vodafone, but Telstra still maintains its dominant position in the telecommunication market. With the diminishing growth in the Australia's telecommunication industry, Telstra has expanded its business in other potential market in Asia-Pacific regions, particularly in Hong Kong.

The national long distance and international call, and mobile telephony service are the segments most intensively compete in the market. However, Telstra still capture a market share greatly over the competitors. Telstra, Optus and Vodafone each operate separate GSM mobile networks, capturing the market share of around 57 %, 31% and 11% respectively as of 2002 .

Bargain power of supplier

Telstra is the largest network and services supplier in the market, as well as a supplier to its, because its control of network capacity and large share of customer base. It has overwhelming dominance across the telecommunications market and in almost every segment of that market. Its wholesale share of land-based market is 94.1%, including basic access lines resold by its competitors (ACCC report). Telstra's dominant market position...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Essay about Porter's Five Forces Article Review
  • Porter's Five Forces Research Paper
  • Porter’s Five Forces Essay
  • Porter's Five Forces Essay
  • Essay about Gm Porter's Five Forces
  • Porter's Five Forces Example Essay
  • Essay about Porter’s Five Forces Model
  • Porter's Five Forces Essay

Become a StudyMode Member

Sign Up - It's Free